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      Question

      In the Keynesian consumption function C = a + bY, 'a'

      represents:
      A Marginal Propensity to Consume. Correct Answer Incorrect Answer
      B Autonomous consumption. Correct Answer Incorrect Answer
      C Induced consumption. Correct Answer Incorrect Answer
      D Disposable income. Correct Answer Incorrect Answer
      E None of these Correct Answer Incorrect Answer

      Solution

      The intercept 'a' is consumption when income is zero, financed by savings or borrowing. It's autonomous (independent of current income).

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